Genetic defects, such as alpha 1 antitrypsin deficiency, often result in impairment of the function or viability of hepatocytes. Replacement of dysfunctional hepatocytes with genetically modified liver progenitor cells (such as oval cells) or hematopoietic stem cells (HSC) holds great potential for treatment of these liver diseases. In this project, we hypothesize that liver progenitor cells and HSC can be transduced by recombinant AAV and B19 vectors and serve as an efficient and safe platform for gene therapy. In order to test this hypothesis, we propose to evaluate the transduction efficiency of liver progenitor cells and HSC with rAAV and AAV-B19 pseudo vectors. The most effective vectors will be used to transduce these stem cells ex vivo. The transduced somatic stem cells will be transplanted into syngeneic mouse liver. Transgene expression, vector DNA integration, and stem cell proliferation will be evaluated after syngeneic transplantation. Since stem cells are involved in cell proliferation, enhancing and controlling vector DNA integration becomes crucial for effective and safe gene therapy. We have recently demonstrated that a cellular enzyme, DNA-PK inhibits rAAV DNA integration. In this project, we propose to enhance vector DNA integration by inactivation of DNA-PK in stem cells. We also propose to achieve site-specific integration by Rep-protein linked gene transfer to stem cells from S1-transgenic mouse. Thus, the ex vivo transduction of progenitor cells presents a very useful model for studying the frequency and mechanisms of vector DNA persistence. Furthermore, we anticipate developing a novel cell and gene therapy approach for the efficient and safe treatment of genetic liver diseases.